July Antitrust Bulletin

July 12, 2010

Competition Bill Introduced in Hong Kong

On July 2, 2010, after several years of drafting and public consultation, Hong Kong unveiled its draft competition bill. The bill, which will be introduced in the legislature on July 14, 2010, would prohibit anticompetitive agreements and concerted practices, as well as any abuse of a “significant” market position that has the purpose or effect of preventing, restricting or distorting competition in Hong Kong. The proposed legislation also creates a competition commission to investigate complaints and bring public enforcement proceedings, as well as a competition tribunal to adjudicate cases. As currently drafted, the bill does not include comprehensive merger procedures, though there is a merger rule that would apply only to licensees in the telecommunications industry. If enacted, the legislation would be implemented in 2012.

Federal Agencies Continue Focusing on Competition in Agriculture Markets

On June 25, 2010, the U.S. Departments of Justice and Agriculture held their third joint public workshop on competition and regulation in the agriculture sector. This workshop focused on issues in the dairy industry. Earlier workshops concentrated on grain farming and hog production, and the poultry industry. Two additional workshops are scheduled for this year.

On June 18, 2010, Agriculture Secretary Tom Vilsack announced proposed changes to the Packers and Stockyards Act, which regulates the livestock and poultry industries. Under the new regulations, which were published June 22, 2010, a meat producer would no longer be required to prove harm to competition when bringing a claim about anticompetitive conduct, and limitations would be placed on poultry growing arrangements, swine production contracts, and how meatpackers obtain cattle on the open market. Public comments on the proposed rules will be accepted through Aug. 23, 2010.

European Commission Reduces Cartel Fines Citing Economic Conditions

The European Commission has recently taken into account that current economic conditions may significantly limit a company’s ability to pay a cartel fine. On June 23, 2010, the commission reduced the fines of five companies that had participated in a bathroom equipment manufacturers cartel to “a level they should be able to pay,” after acknowledging that the companies were financially in “very bad shape already.” On June 30, 2010, the commission reduced the fines of three companies that participated in a prestressing steel producers cartel based on their inability-to-pay arguments. Additional information is available in our July 2010 EU/UK Competition Law Newsletter.